A

PROJECT
REPORT
ON
“ ULIP”
(A STUDY ON
SECURITY
AND
INVESTMENT
PLAN)
 CONTENTS OF THE PROJECT

PAGE NO.
 Preface

 Certificate from the Organization

 Acknowledgement

 Declaration

 Introduction

 Objectives & methodology

 Industry profile

 Company profile

 Topic taken in the Organization

INCLINATION TOWARDS ULIP (A Study on security and investment plan)

 Findings

 Recommendation

 Conclusion /summary

 Bibliography

 Annexure

2
 PREFACE

Beginning of the system project is entirely creative. This does not come all of
a sudden, but it comes by result of discussion, consultation and contemplation.
Problem unsolved here can never be satisfactory eliminated later. It is therefore a slow
process.

Moreover practical training is an important part of management courses. The

theoretical studies are not sufficient to get into the corporate world. Only practical
knowledge can help us to understand the complexities of large scale organizations.

To develop healthy managerial and administration skill in potential managers,

it is necessary that theoretical knowledge must be supplemented with exposure to the
real environment. Actually, it is life for, a management itself is realized.

3
 ACKNOWLEDGEMENT

Heartfelt thanks to the following people….

A Few typewritten words of thanks can-not really express the sincerity of my

gratitude. But I am still trying to put into words my gratefulness towards all who have
helped & encouraged me in carrying out this project.

4
 CHAPTER 1

INTRODUCTION

5
 INTRODUCTION

Insurance

Insurance may be described as to protect the economic value of asset. It can be said to
be a system of spreading the losses of an individual over a group of individuals. Since
it is an intangible product, Insurance Industry is a service industry. Insurance Industry
does not produce any goods but sell the promise. A promise to take care of the
customers or their dependents in case they suffer a loss due to some peril during the
term of policy.

What is insurance:

Mankind is exposed to many serious perils such as property losses from fire and
windstorm and personal losses from disability and premature death. Although it is
impossible for an individual to foretell or completely prevent their occurrence but it is
possible to provide against their financial effect the loss of property and earnings.

From the point of view of the individual the life Insurance may be defined as a
contract whereby for a Consideration amount called the premium, one party (the
insurer) agrees to pay to the other (the insured) or a beneficiary a particular amount
upon the occurrence of death or any other agreed event.

 Insurance is the method of spreading and transfer of risks

 Losses of few unfortunate are shared by and spread over to many exposed to
the same risk.

 Assets created by the owner in expectation of future needs have a value.

 Losses of assets for any reason deprive the owner of the expected benefits.

 It acts as a form of a safeguard against misfortunes.

6
  From the point of view of community life insurance may be defined as a social
device to make accumulations to meet uncertain losses resulting from
premature death or disability.

Purpose and need of insurance :

As said earlier that the making is exposed to many serious perils which risk the
security of their belongings. The risk here means that there is a possibility of
occurrence of loss or damage to the property, it may happen or may not happen.
Insurance is relevant only in the contingency of uncertainty. If there is no uncertainly
about the occurrence of the loss it can’t be insured against:

 Assets are likely to be destroyed or made non-functional due to perils like

firefloods, breakdowns, lightning and earthquake.

 Damage to assets caused by any perils is the risk that assets are exposed to.

 Insurance become relevant only if there is uncertainly of occurrence of event

leading to loss.

 No uncertainty No insurance.

 We can say that the human life value is an ongoing generating asset, which
can be lost on early death or disability caused by accidents.

 Insurance doesn’t protect the assets but only compensates the economic or
financial loss.

 Basically insurance covers tangible assets but the concept can be extended to
intangible also.

7
 FUNCTIONS OF INSURANCE
The functions of Insurance can be bifurcated into two parts:

1. Primary Functions
2. Secondary Functions
The primary functions of insurance include the following:

Provide Protection - The primary function of insurance is to provide protection

against future risk, accidents and uncertainty. Insurance cannot check the happening
of the risk, but can certainly provide for the losses of risk. Insurance is actually a
protection against economic loss, by sharing the risk with others.

Collective bearing of risk - Insurance is a device to share the financial loss of few
among many others. Insurance is a mean by which few losses are shared among larger
number of people.

Assessment of risk - Insurance determines the probable volume of risk by evaluating

various factors that give rise to risk. Risk is the basis for determining the premium
rate also.

Provide Certainty - Insurance is a device, which helps to change from uncertainty to

certainty. Insurance is device whereby the uncertain risks may be made more certain.

The secondary functions of insurance include the following:

Prevention of Losses - Insurance cautions individuals and businessmen to adopt

suitable device to prevent unfortunate consequences of risk by observing safety
instructions; installation of automatic sparkler or alarm systems, etc. Prevention of
losses causes lesser payment to the assured by the insurer and this will encourage for
more savings by way of premium. Reduced rate of premiums stimulate for more
business and better protection to the insured.
Small capital to cover larger risks - Insurance relieves the businessmen from security
investments, by paying small amount of premium against larger risks and uncertainty.

8
Contributes towards the development of larger industries - Insurance provides
development opportunity to those larger industries having more risks in their setting
up. Even the financial institutions may be prepared to give credit to sick industrial
units which have insured their assets including plant and machinery.

Life Insurance

Life insurance is a contract where the person requiring and insurance pays a
consideration / premium to maintain a policy and the insurer promises to pay a sum
assured or a guaranteed amount on the happening of an eventuality. If no eventuality
occurs then the insured may be eligible for some bonus also.

Why life insurance :

1. Protection of the interest of the family member.

2. Provision for education and marriage of the children.

3. Post retirement income for self and dependents

4. Special needs for medical expenses.

5. Provision for health /illness.

6. Provision for housing.

7. Provision for income tax rebate.

9
 Benefits of Insurance

Insurance not only serves the ends of individuals or of special groups of individuals
but also is advantageous to the society as a whole.

Benefits To The Individual

 Superior to any other saving plans:

Unlike any other saving plan, a life insurance policy affords full protection against
risk of death. In the event of death of a policy holder, the insurance company makes
available the full sum assured to the near and dear of policy holder. In comparison,
any other saving plan would amount the total saving accumulated till date. If the death
occurs prematurely, such saving can be much lesser than sum assured. Evidently, the
potential financial loss of the family of the policy holder is sizable.

 Encourages and forces thrift:

A saving deposit can easily be withdrawn. The payment of Life insurance premiums,
however, is considered sacrosanct and is viewed with the same seriousness as the
payment of interest on a mortgage. Thus, a life insurance policy in effect brings about
compulsory saving.

 Easy Settlement And Protection Against Creditors:

A life insurance policy is the only financial instrument, the proceeds of which can be
protected against the claims of a creditor of the assured by affecting a valid
assignment of the policy.

 Ready marketing and suitability for quick borrowing :

10
A life insurance policy can, after a certain period (generally Three years), is
surrendered for a cash value. The policy is also acceptable as a security for
commercial loans, for example, a student loan.

 Disability benefits :

Death is not only hazard that is insured; many policies may include disability benefits.
Typically, these provide for waiver of future premiums and payment of monthly
installment periods.

 Accidental death benefits :

Many policies can also provide for an extra sum to be paid (typically equal to the sum
assured) if death occurs as a result of accident.

 Tax relief :

Under the Indian income tax act, the following tax relief is available

1. 20% of premium can be deducted from total income tax liability.

2. 100% of the premium paid is deductible from your total taxable income.

When these benefits are factored in, it is found that most Policies offer returns that are
comparable /or even better than other saving modes such as PPF, NSC etc. moreover,
the cost of insurance is a very negligible.

 Benefits to business :

Insurance results in business continuation and welfare of employees. Uncertainty of

business losses is reduced by insurance.

11
 Benefits of society :

The welfare of the society is protected. Insurance results in economic growth of the
country and reduction in inflation.

ICICI BANK

The World Bank established ICICI LTD in 1955, the Government of India and
the Indian Industry, promote Industrial development of India by providing project and
corporate finance to Indian industry.

ICICI has grown from a development bank to a financial conglomerate and

has become one of the largest public financial institutions of India. ICICI has financed
almost all major sector of the economy, covering 6848 companies and 16851projects.
In the fiscal year 2002- 2003, ICICI had disbursed a total of Rs 45673 billion. Assets
worth.1676.59 billion as on 31st of march 2005 and customer 6 million and 5 million
policyholder account. Multi channel network, 573 branches and 2000+ATMs

PRUDENTIAL

Prudential was founded in 1848. Prudential is the largest life insurance company in
the United Kingdom. Provides retail financial services products and services to more
than 20 million customers, policyholder and unit holders and manages over £300
billion of funds worldwide (as of 31 December 2006). In Asia, Prudential is the
leading European life insurance company with life operations in China, Hong Kong,
India, Indonesia, Japan, Korea, Malaysia, the Philippines, Singapore, Taiwan,
Thailand and Vietnam. Prudential is the second largest retail fund manager for Asian
sourced assets ex-Japan as at June 2006. Its fund management business has expanded
into a total of ten markets.

12
 ICICI + PRUDENTIAL (JOINT VENTURE)

A Joint venture ICICI and Prudential of UK

ICICI Prudential started its operation in December 2000

The key objective of ICICI prudential is to provide the Indian citizen to suit a variety
of needs.

Prudential “genesis”

Founded in 1848-U.K.
Fourth largest insurance company in the world as per fortune 500 in terms of revenues
Leading life insurance Company in United Kingdom.
Over US$ 270 BILLION (Rs.12, 69,000 crores) under a management.
AAA rating from standard & poor’s (the highest rating)
Over 75 years of experience with operation in 11 countries.

13
 CHAPTER 2
RESEARCH METHODOLOGY

14
 RESEARCH METHODOLOGY

 Objective of study

 Type of research

 Source of data

 Sampling unit

 Sample size

 Type of sampling

 Method of data collection

 Instrument used for data collection

 Limitation

15
 RESEARCH METHODOLOGY

Research Methodology deals with, the procedure adopted to carry out the study.
According to green and Tull: “A research design is the specification of methods
and procedures acquiring the information needed It is the overall operational pattern
or framework of the project that stipulates which information is to be collected from
which sources by what procedures’’.

OBJECTIVE OF STUDY

The purpose of research is to discover answer to questions through the application

of scientific procedures. The main aim of research is to find out truth which is hidden
and which has not been discovered as yet. We may think of research objectives as
falling into a number of following broad grouping:
 To check the awareness level of people about insurance.
 To know the reasons for increasing trend of unit linked insurance plan.
 To know how ULIP are differ from Traditional plans means how they give
better returns than traditional plan.
 Comparison of ULIP with other investment instrument available in
the market.

TYPE OF RESEARCH

Research refers to the search for knowledge. It can be defined as scientific

and systematic search for pertinent information on a specific topic. It is careful
investigation or enquiry especially through search for new facts of any branch of
knowledge. Research plays an important role in the project work. The result of the
project is completely based upon the research of the facts and figures collected
through the different ways of research. That is why it is also called a movement from
known to unknown.

16
Exploratory or Formulative research: Exploratory research is conducted to clarify
the ambiguous problems.

Descriptive research: To portray the characteristics of an individual, group, situation.

Diagnostic research: To determine the frequency of occurrence of an event.

SOURCE OF DATA

In the data collection method, we have collected both primary and

secondary data to meet our objective.
Primary data:
The primary data was collected by a survey based on the questionnaire. It was
formulated on the basis of information gathered by me with the help of Mr. Kapil
Chawla who provide useful guidelines and objective of our study.

Secondary data:
The secondary data was collected from books and internet.

Research Approach:
The required information in the form of data is collected through survey
method, with the help of personal interview through questionnaire method.

Sampling plan:
There is a stage where the planning is done about the sample units, sample size,
sampling procedures, etc.

Sampling units:
This means, which is to be surveyed. So as mention earlier that the sample units
is potential peoples..

Sample size:
The sample size means how many peoples should be surveyed. So that total
sample size is 100, which cover from different area of Gurgaon.

17
Sampling Procedures:
I choose convenient and judgmental sampling for my research.

Data collection method :

Personal interview method is used for collection of primary data in the form of
questionnaire from respondents.

Research Instruments:
Once the source of data collection is decided then comes the instrument for data
collection or the research instrument. In this survey method a questionnaire was
framed. This is Philip by the potential people though personal interview

LIMITATION

How so ever impeccable a thing may see to be there always dwell some possibilities
of failure and incompleteness. The result of this work also subject to some of
limitations.
Which are as follows:
 The main limitation of the study is the availability of time. As the sufficient
time was not available for collection of information.
 Some respondents were not interested in giving answer and
they appeared to be busy.
 Lack of experience.

18
 CHAPTER 3

INDUSTRY PROFILE

19
 INSURANCE INDUSTRY PROFILE

Life Insurance :

As is evident from its very name, it deals with insurance of human life. “Life
insurance corporation of India”- a public sector undertaking has the monopoly in this
sector since its nationalization.

In our wordily life, whenever there is uncertainty, there is an involvement of risk. The
instinct for security against such risk is one of the basic motivating forces determining
human attitudes. As a squeal to this quest for Security, the concept of insurance must
have been born. The urge to provide insurance or protection against the loss of life &
property must have prompted people to make some sort of sacrifice willingly in order
to achieve security through “COLLECTIVE CO-OPERATION”, in this sense; story
of insurance is probably as old as THE story of mankind.

INSURANCE INDUSTRY IN INDIA

India is marching ahead to more prosperous future. The economy is on a

high growth path, domestic savings are growing, exports have risen and inflation has
stabilized. Infrastructure sector, which even today is woefully inadequate to meet the
expected increased industrial activities, has been accorded top priority by the
government. All this should reflect in a growth rate of 7 to 8% for the next 3-4 years.
With this scenario of high economic growth further reforms in the financial sector are
in the Common Minimum Program of the Government.

India is regarded as under- insured country with insurance penetration at a very low
level of 0.6% of GDP. Insurance, as a rule, has always been given very low priority
by corporate India. It is always taken with reluctance, usually only when it is

20
compulsory, and then only by big industrial houses. Without exception it is always
inadequate to meet the needs of the corporate sector.

In addition to the tradition exposure of fire, floods, workers compensation and the
interruption, Corporate India also has to address unpredictable changes in areas such
as environment; security; occupational health and safety; public liabilities; Directors
and Officers Liability and product liability
It therefore becomes quite obvious that purchase of insurance, in itself, will not
substitute for a soundly based and property implemented Risk Management
Program as insurance can only offer some financial relief by replacing the plants; it
cannot replace the loss in development of a business or development of the market.

The likely private players:

A number of foreign insurance companies have set up representative office in India

and have also tied up with various asset management companies. They have either
signed Memorandum of Understanding with Indian companies or are trying to do the
same. A few of them have been around for the last four to five years. Some have
carried out extensive research on the Indian insurance sector. Others have set up
liaison offices. All of them are waiting with bated breathe for the opening up of the
sector and taking a bite of the great Indian Insurance pie.

21
 Various Players Presents In The Market

1. Bajaj Allianz Life Insurance Company Limited.

2. Birla Sun Life Insurance Co. Ltd.
3. HDFC Standard Life Insurance Co. Ltd.
4. ICICI Prudential Life Insurance Co. Ltd.
5. ING Vysya Life Insurance Company pvt.Ltd.
6. Life Insurance Corporation of India.
7. Max New York Life Insurance Co. Ltd.
8. Kotak Mahindra Old Mutual Life Insurance Limited.
9. SBI Life Insurance Co. Ltd.
10. Tata AIG Life Insurance Company Limited.
11. Reliance Life Insurance Company Limited.
12. Aviva Life Insurance Co. India Pvt.Ltd.
13. Sahara India Life Insurance Co.Ltd.
14. Shriram Life Insurance Co.Ltd.
15. Bharti AXA Life insurance Company Ltd.
16. Met Life India Insurance Company Pvt. Ltd.

22
MOST RELIABLE PVT. LIFE INSURANCE COMPANY

MOST RELIABLE PVT.LIFE

INSURANCE CO.

ICICI

BIRLA SUN LIFE

9%
12%
39%
HDFC STANDARD
15% LIFE
25% MAX NEWYORK
LIFE
TATA AIG

23
 INTRODUCTION TO IRDA

Insurance regulatory authority, 1996 (IRA):

• The IRA was set up in January 1996

• The IRA bill has first to be passed by parliament to make the IRA a
statutory body.
• Second, the powers of the erstwhile controller of insurance have to
be conferred on the IRA.
• Third, comprehensive legislation aimed at reviewing the insurance
act of 1938 and repealing the LIFE INSURANCE CORPORATION
ACT of 1956 and the general insurance (Nationalization) act of 1972
have to be passed.

Government’s pronouncements:

• Post statutory status, IRA to be centre piece for future insurance sector
reforms
• IRA will be sole authority, which will be responsible for awarding of
licensing i.e. little or no government or political interference in licensing in
process.
• No restriction on the no. of licenses.
• No composite licenses for life and non life business.

IRDA was set up to protect the interests of the policyholders, to regulate, promote and
ensure orderly growth of the insurance industry. After this the private players started
entering the market.

24
 CHAPTER 4
COMPANY PROFILE

25
 Organizational set up

 The organizational set up of a company plays an important role in the overall

efficient working of the various departments leading to an improved overall
performance. The arrangement has to be made in such a way that activities are
carried out in each department in the smooth way.

 The department has to be made on the basis of various activities of the

company.

 Activities generating revenue should be given more importance than non-

revenue activities.

 Thus various offices, departments and sections must be created after looking
the important activities of the Insurance Company.

Important activities:

The important activities of the Insurance companies are:--

 Procuring new proposals for grant of life insurance cover.

 Scrutiny of proposals and giving decisions for

 Accepting/rejecting the proposals of Insurance.

 Issuing a policy document.

 Keeping track of performance of insurance contract by way of receipt of

premiums.

 Providing assistance in various matters like nominations, assignment,

alteration of terms, change of address and payment of claims.

26
  Other activities like investment of funds, maintenance of accounts, personnel
management, data processing and complying with other legal and regulatory
requirements.

Structure Of The Company:

The ICICI Prudential is a joint venture of ICICI (74%) and Prudential UK

(26%). ICICI Prudential Life Insurance was incorporated on July 20, 2000 and was
granted a certificate of registration for carrying out life insurance business, by the
IRDA on November 24, 2000.

ICICI Prudential's capital base stands at Rs. 18.15 billion with ICICI Bank and
Prudential plc holding 74% and 26% stake respectively. For the 9 months ended
December 31, 2006, the company garnered Rs.27.22 billion of weighted retail and
group new business premium and wrote over 1.1 million policies. Assets held stand at
over Rs.1000 billion.

It commenced commercial operation on December 19, 2000 becoming one of

the first private sector players to enter the liberalized arena. During the short period
till March 31, 2003 The company has issued 2.45 policies translating into a premium
Income Rs 59.7 million and the sum assured of over Rs 1000 million. The company is
now operating in Mumbai. New-Delhi, Pune, Chennai, Kolkata, Bangalore,
Ahmedabad, Hyderabad and Lucknow.

ICICI PRUDENTIAL LIFE INSURANCE

ICICI Prudential Life Insurance Company is a joint venture between

ICICI Bank - one of India's foremost financial services companies and
Prudential plc - a leading international financial services group headquartered in the
United Kingdom. Total capital infusion stands at Rs. 20.60 billion, with ICICI Bank
holding a stake of 74% and Prudential plc holding 26%.

We began our operations in December 2000 after receiving approval from Insurance

27
Regulatory Development Authority (IRDA). Today, our nation-wide team comprises
of over 580 offices, over 230,000 advisors; and 23 bancassurance partners.

ICICI Prudential was the first life insurer in India to receive a National Insurer
Financial Strength rating of AAA (Ind) from Fitch ratings. As we grow our
distribution, product range and customer base, we continue to tirelessly uphold our
commitment to deliver world-class financial solutions to customers all over India.

Promoters Of Icici Prudential

ICICI Bank :

ICICI Bank is India’s second-largest bank with total assets of about Rs.1892.18
billion and a network of about 590 branches and offices and about 2030 ATMs. It
offers a wide range of banking products and financial services to corporate and retail
customers through a variety of delivery channels and through its specialized
subsidiaries and affiliates in the areas of investment banking, life and non-life
insurance, venture capital, asset management and information technology.

ICICI Bank posted a net profit ofRs.1, 637 crore for the year ended September 30,
2005. ICICI Bank’s equity shares are listed in India on stock
exchanges at Chennai, Delhi, Kolkata and Vadodara, the Stock Exchanges, Mumbai
and the National stock exchange Of India limited and its American Depositary
Receipts (ADRS) are listed other New York Stock Exchange (NYSE).

PRUDENTIAL PLC :

Established in London 1848, Prudential plc is a leading international financial

services company In the UK, with around US$300 billion funds under management,
and more than 20 Million customers worldwide (as of 31 December). Prudential has

28
brought to market an integrated range of Financial services products that now includes
life assurance, pensions, mutual funds, banking investment management and general
insurance. In Asia, Prudential is UK’s largest life insurance company with a vast
network of 24 life and mutual fund operations in twelve countries—China, Honk
Kong, India, Indonesia, Japan, Korea, Malaysia, the Philippines, Singapore, Taiwan,
Thailand and Vietnam.

29
 Management hierarchy

MD & C.E.O (Ms. SHIKHA SHARMA)

EXECUTIVE DIRECTOR (Mr. BHARGAV DAS GUPTA)

HEAD OF SALES, HIMALAYAN (Mr. AMIT PALTA)

VICE PRESIDENT (Mr. SANTOSH CHACKO)

ASSOCIATE REGIONAL MANAGER (Mr. HEMANT SIKKA)

AREA MANAGER (Mr. AJAY NEB)

SALES MANAGER (Mr. SUNIL BHATIA)

AGENCY MANAGER (Mr. KAPIL CHAWLA)

UNIT MANAGER

30
 VISION

To make ICICI Prudential the dominant life, health and Pensions player built
on trust by world –class people and service.
This we hope to achieve by:

• Understanding the needs of customers and offering them superior products and
service
• Leveraging technology to service customers quickly, efficiently and conveniently.
• Developing and implementing superior risk management and investment
strategies to offer sustainable and stable returns to our policyholders.
• Providing an enabling environment to foster growth and learning for our
employees.
And above all, building transparency in all our dealings.

The success of the company will be founded in its unflinching commitment to 5 core
values- integrity, customer first, Boundary less, Ownership and passion. Each of the
values describes what the company stands for the qualities of our people and the way
we work.

We do believe that we are on the threshold of an exciting new opportunity, where we

can play a significant role in redefining and reshaping the sector. Given the quality of
our parentage and the commitment of our team, there are no limits to our growth.

31
 SWOT ANALYSIS OF ICICI PRUDENTIAL

Strengths:

• ICICI Prudential is the largest private player in the insurance industry in

INDIA , with a market share of around 32% amongst the private players.
• It received best products innovation award from Asian banker in 2001.
• Vast untapped market. In a country of 1 billion people there is huge potential
market for life insurance products.
• There is a huge pool of skilled professionals to carry out the successful
ventures.
• ICICI Prudential is one of India’s leading financial institutions.
• Offering a complete financial solution that encompasses every sphere of life.
• From commercial banking
To stock broking
To mutual funds
To life insurance
To investment banking,
The group caters to the financial needs of individuals and
Corporate.
• ICICI prudential is the first company, which got license of insurance trading
from I.R.D.A. (Insurance Regulatory & Development Authority)
• ICICI Prudential is leading in securities.
• The company has a network in 74 cities in India and offices in New-York,
London and Dubai.
• The group services a customer base of over 2.7 million.

32
Weaknesses:

• Though there is a huge market for insurance polices, the middle class who
constitutes bulk of this market is burdened with inflationary pressure and
therefore is not able to save for future.
• Less popularity of ICICI Prudential in villagers.
• Most of the people have faith on LIC as it is a Govt. Organization.

Opportunities:

• Out of 320 million insurable market only 20% of population is insured.

• The ICICI Prudential group is going to open 100 branches of ICICI Prudential
in coming 4-5 years.
• The insurance sector is growing so there is opportunity for business growth.
• Unemployment is today a big problem in our country; therefore people who
have the potential should be encouraged to enter in to this sector.

Threats :

• Competition is growing as new entrants are coming in insurance sector .

• Main threat is “COMPETITORS”.

33
 CHAPTER 5

TOPIC TAKEN IN
ORGANIZATION

34
 Classification of Life Insurance Products

We can classify insurance plan in two categories.

 Traditional
 ULIP
Traditional

Term Insurance :

Under term insurance plan, sum assured is payable only if death occurs during the
specified pre-determined term. If death does not take place during such term the
amount of premium stands forfeited. Thus it can be seen that the term insurance is
nothing but the cost of pure protection. It is a contract, which provides financial
protection if death should occur within a specified period. No survival benefits are
provided under the contract.

Whole life insurance:

Whole life insurance provides for the payment of the face value upon the death of the
insured, regardless of when it may occur. This policy furnishes permanent protection
to the insured at he moderate cost. This is highly important for the average man or
woman of moderate salary, who require considerable family protection and whose
limited income does not enable him or her both to pay premiums and to accumulate a
large savings fund. The whole life policy provides a capital sum of money in the
event of death of the assured whenever that may occur.

Endowment Policy:

35
Endowment is a product, which includes Risk cover and saving also. In the pure
endowment policy the sum assured is payable in the event of death or definitely on
maturity. In an endowment sum assured is for sure given to the policyholder on
completion of the term. Endowment plans are very popular in developing nations
since they serve a dual purpose of life cover and savings. Many a people in our
country go for endowment products because of the compulsory saving aspect. An
endowment plan on the other hand is not a cheap plan since the insurer has a dual
liability of providing life cover and on maturity giving the entire sum assured.

Annuities:

Annuities refer to income or other financial provision usually for retirement or old
age. An Annuity may be defined as a periodic repayment made during a fixed period
or for the duration of a designated life or lives. In one sense the life annuity may be
described as the opposite of insurance protection against death in its pure form a life
annuity may be defined as a contract whereby for a premium consideration one party
(the insurer) agrees to pay the other (the annuitant) a stipulated sum (the annuity)
periodically throughout life. The purpose of the annuity is to protect again a risk—the
outliving of one’s income.

UNIT LINKED INSURANCE PLAN (ULIP)

Unit linked insurance plan (ULIP) is a life insurance solution that provides the client
with the benefits of protection and flexibility in investment. It is a solution which
provides for life insurance where the policy value at any time varies according to the
value of the underlying assets at the time .

The investment is denoted as unit and is represented by the value that it has attained
called as Net Asset Value (NAV).

36
 UNITS
UNIT
UNDERLYING
LINKED
IN
INSURANCE
INVESTMENT
POLICIES
FUNDS

U
LIP came into play in 1960s and became very popular in Western Europe and
America. The reason that is attributed to the wide spread popularity of ULIP is
because of the transparency and the flexibility which it offers to the clients.

As time progressed the plans were also successfully mapped along with life insurance
needs to retirement planning.In today’s times ULIP provides solution for all the needs
of a client like insurance planning, financial needs, financial planning for children’s
future and retirement planning.

Structure Of Ulip

PREMIUM

LESS CHARGE

INVESTMENT LIFE
REPRESENTED AS COVER
UNITS

37
Benefits of unit linked plan :

ULIP distinguishes itself through the multiple benefits that it provides to the
consumer. The plan is a one stop solution providing

1. Life protection
2. Investment and Savings

a. Market linked fund based on risk profile

b. Switch option
c. Premium redirection
d. Automatic transfer plan(ATP)

3. Flexibility of cover continuance

4. Transparency
5. Extra protection with riders

a. Death due to accident

b. Disability
c. Critical illness

6. Liquidity

a. During the term partial withdrawals

b. At Maturity

7. Tax planning

38
 Charges Under Ulip

Contribution related charges:

These are the charges that are represented as a percentage of the regular or single
contribution paid. In case of a regular contribution plan, it is usually high in the first
year to pay for the distribution cost. This charges pays for the issuance and for
distribution commissions. This charges are running for the policy.

Administrative charges:

These are charges that are levied for the administration of the policy and the related
cost of administration of the insurance company,itself. They are more related to the
cost like IT , operational, etc cost of continuing the policy.

Fund management charges:

These are the charges for buying and selling debt and equity. These are the charges
are adjusted in NAV it self.

Mortality charges:

This covers the cost of providing life protection for the insured and may be paid once
at the start of the policy for a recurrent manner for example this charges levied to
provide the insurance cover under the plan . normally these charges are one year
charges as per the age of the holder.

39
Rider charges:

Rider charges are similar in nature to the mortality charges as they are levied to pay
for the other protection benefits that the policy holder has choosen for- like the critical
illness benefit or the accident benefit,etc.

Surrender charges:

When the policy holder decides to surrender the policy or partially withdraw some of
the units for cash , a surrender charge may be apply.
Surrender charges are used to cover initial expenses that have been incurred by the
company but not yet recovered from the policyholder yet.

Bid offer charges:

In ULIP specifically certain insurers might create a difference in the price at which
they sell the unit and the price at which they buy the units. Investor’s contribution are
used to buy units in the investment fund at the offer price and are sold when benefits
are required at the bid price. The difference between the offer and bid prices Is known
as the “bid-offer spread", this is used to cover expenses when setting up the policy.

Transactional specific charges:

These charges are levied when the client does some specific transaction like changing
funds, topping up the investment component or withdrawals .

Investment Option For Your Money

40
Maximiser: If high growth is your priority, this is the plan for you. You can enjoy
long-term capital appreciation from a portfolio that is invested primarily in equity and
equity-related securities

Protector: - If on the other hand, your priority is steady returns, you can opt for the
protector Plan. Plan, you can accumulate a steady income at a low risk across a
medium to long-term period from a portfolio, which is primarily invested in fixed
income securities.

Balancer:-If you prefer a balance of growth and steady returns, choose our balancer
plan. This would ensure that your portfolio is invested in equity-linked securities, as
well as in fixed income securities.

Preserver: The objective of this plan is not ensuring capital protection by investing in
very low risk investments like the cash and call money markets. However, the returns
generated may also be on the lower side due to the investment pattern. At inception,
investments up to 20% can be allocated to this fund.

POTENTIAL
FUND TYPE ASSET MIX
RISK /REWARD
Equity& Related securities:
Max 100%
Maxi miser High
Debt, Money market & Cash:
Max 25%
Debt. Money market & Cash:
Min 60% Moderate
Balancer
Equity & Related securities:
Max: 40%
Debt Instruments,
Protector Money market & Cash: Max Low
100%:
Debt Instruments: Max 50%
Capital
Preserver Money market & Cash: Min
preservation
50%

41
 COMPARISION OF ULIP WITH TRADITIONAL PLAN

Unit Linked Insurance Product:

ULIPs have gained high acceptance due to attractive features they offer. These
include:

 Flexibility
o Flexibility to choose Sum Assured.
o Flexibility to choose premium amount.
o Option to change level of Premium /Sum Assured even after the plan
has started.
o Flexibility to change asset allocation by switching between funds
 Transparency
o Charges in the plan & net amount invested are known to the customer
o Convenience of tracking one’s investment performance on a daily
basis.
 Liquidity
o Option to withdraw money after few years (comfort required in case of
exigency)
o Low minimum tenure.
o Partial / Systematic withdrawal allowed
 Fund Options
o A choice of funds (ranging from equity, debt, cash or a combination)
o Option to choose your fund mix based on desired asset allocation

Traditional Plans :

These are the oldest types of plans available. These plans cater to customers
with a low risk appetite. Some of the common features of traditional plans are:

 Steady Investment
o Major chunk of investible funds are in debt instruments

42
 o Steady and almost assured returns over the long term
 Features
o Death benefit is Sum Assured + guaranteed & vested bonus
o Helps in asset creation as they are for a long tenure
o Premium to Sum Assured ratios are fixed for each plan and age.
o Generally withdrawals are not allowed before maturity.

Point of difference ULIP Traditional Policy

Market related (May be
IRDA? Determined
Investment stock market or debt
investments
market)
Transparency in costs Yes No
Flexibility in payment Yes No
Assured Bonus No Yes
Assured Sum on survival No Yes
Option to increase
Yes No
investment/premium

ULIPs better traditional policies

Until a couple of years ago, when ULIPs were a rare commodity, nobody knew how
life insurance companies charged policyholders for expenses. And nobody seemed to
want to know either. Then came the ULIPs with good intentions to make
policyholders aware of how much they would pay as expenses. But that move
backfired. Policyholders were taken aback by the high amount of fees that ULIPs
charged.

While the charge structure on ULIPs is something that is open to debate, the issue is
that ULIPs alone cannot be isolated. Traditional policies too charge high
administrative and management expenses. In ULIPs, the first year charges range from
20-70%, one does not know how much traditional policies charge.

43
This can have a bearing on returns as well. A ULIP may charge you upfront but
thereafter, all the returns on the fund are yours while a traditional policy may charge
less but share a smaller portion of returns with you.

So if you were substituting a traditional endowment with a ULIP, you would be better
off with the latter since you would know your charges and your returns.

We recommend traditional policies:

Where the objective is only Risk cover and not savings and cost has to be minimum.

We recommend Unit Linked products where: .

• The intention is to provide security for a goal.

• The purpose is to make the savings grow at a better rate seeking the best
solution.

• It is a market linked investment where the premia paid is invested in funds

• Different options are available, like 100% Equity, Balanced, Debt, Liquid etc
and according to the fund selected, the risks and returns vary.
• The costs are upfront and are transparent, the investment made is known to the
investor (As he is the one who decides where his money should be invested).
• There is a greater flexibility in terms of premium payments ie. A premium
holiday is possible.
• You can also invest surplus money by way of top ups which will increase your
investment in the fund and thereby provide a push to returns as well.
• There is no assured Sum on survival, the higher of the Sum Assured or Fund
Value is paid at the maturity or incase of death.

Financial planning and tax planning

All of us want to save for a rainy day. We want our money or investment to:

(i) Give the best possible return and

(ii) Be available to us when we require it.

44
Financial planning makes this possible. Financial planning is an attempt to maximize
returns keeping in mind the liquidity and security of our investment.
The three basic principles (guiding factors) of financial planning are:

• Setting realistic financial goals

• Starting investments early
• Thinking long term while allowing for short-term needs that may arise.

One can invest money only when one possesses it, which is possible by saving
systematically. Selecting a good saving scheme can do this.

Feature of a Good Saving Plan:

(a) Safety
(b) Flexibility
(c) Should have incentive to save continuously without default.
(d) Tax saving
(e) Should fulfill financial objective even in case of death.

Features of an ideal Investment Scheme:

(a) Safety
(b) Liquidity
(c) Higher Yield
(d) Capital growth
(e) Tax saving

Safety: refers to financial soundness of investment.

Liquidity: means quickness with which an assets can be converted into cash
whenever required.

Yield: is the amount of money that an investment is expected to earn.

45
Capital growth: Any return, which is not taxable, will be preferred to those on which
taxes have to be paid. A good investment is that which earns decent returns after
providing for taxes and inflation.
However, there is no single wonder investment, which can have all the above
features. A prudent person should look for those investments, which offer the ideal
solution to his personal needs under his own set of circumstances.

High Returns and Best Returns;

(i) These are not necessarily the same.
(ii) High returns may be offset by risk to capital.
(iii) Best returns should be determined by the advantage an investment offers.

The Investor’s Approach:

Investor’s approach can be conservative (safety is of utmost importance), enterprising
(willing to take some risks) or speculative (willing to take high risk in order to gain
high returns). The investor’s approach is related to a host of personal factors such as:
a) Age and family
b) Future responsibilities

Tax Benefits Under Life Insurance Policies

Qualifying premium amount: -

a) Premiums paid to effect or keep in force an insurance policy on the life of
• The assessee; or
• The spouse of the assessee; or
• Any child (minor or major) of the assessee.

b) Premiums paid to effect or keep in force a contract for a deferred annuity on the
life of
• The assessee; or

46
 • The spouse of the assessee; or
• Any child (minor or major) of the assessee provided that such contract, does
not contain a provision for exercise by the assured of an option to receive a
cash payment in lieu of the annuity.

Tax relief for savings through life insurance

• An aggregate amount of savings including those paid towards life insurance
premium up to Rs. 1 lakh not to be included in the income liable for tax.
• Premiums paid under an approved pension plan up to Rs. 10,000/- per year of
various insurance companies are deductible from the total income up to a
maximum Rs. 10,000/- under section 80 CCC.
• The amounts received as claims – whether on maturity or death – including
the bonus, if any, are not taxable, being capital receipt under section 10(D)

What makes ULIP a total financial planning package?

• Potential for Superior returns by switching between Equity & Debt.

• Liquidity and Flexible Insurance Cover.
• No Long Term Commitments.
• 100% Tax Free Returns on Withdrawals & Maturity.

47
 Comparison of ULIP with other Investment Modules

OTHER RATE OF TIME RISK MIN. MAX TAX TAX

INSTRUMENT RETURN PERIOD INVEST INVEST FREE BENE
MENT MENT RETU FIT
RN
NSC 8% 6years No 100 No limit No Yes
PPF 8% 15years No 500 70000 Yes Yes
ELSS Market 3years Risky 500 No limit Yes Yes
Return
ULIP Market 5years Risky 500 No limit Yes Yes
Return Modu
le
FD 9.5% 5years No 10000 No limit No Yes
Market Open High 500 No limit Capital Only
MUTUAL Return Ended gain in
FUND @10% ELSS
for time Funds
less
than
1year
STOCK Variable No time Very Variable No limit Capital No
frame high gain
@10%
for time
less
than 1
year

Life Time Super

48
It is necessary that we understand a few terms before look in to the various financial
planning ways.

Save: this is an activity that helps in the “asset allocation”. It has both a short term &
long term perspective.

Invest: this is an activity that focuses “asset creation”. It involves making money
from money.

Spend: this is the activity of using the money for our expenses.

49
 ASSET
SAVE ACCUMUL
ATION

ASSET
INVEST CREATIO
N

ASSET
SPEND PROTECTI
ON

How Life Time Super Provides Asset Pprotection, Asset Creation,

Asset Accumulation

Flexible policy term: Decide for how long you want your policy. You can invest for
a minimum of 10 years and a maximum of 75 years.

50
3 choices of premium payment: Opt to pay the premium on a monthly, bi-annual or
an annual basis.

6 investment funds: Select among Flexi-Growth, Maximiser, Flexi-Balanced,

Balancer, Protector, and Preserver, based on your financial goals and risk profile.

Systematic withdrawal of money: Withdraw money in installments from the 4th

year onwards.

Maturity benefit: Receive the Fund Value when your policy matures. Choose to take
this value as a single lump-sum amount or in monthly, bi-annual or annual
installments.

Death benefit: Your family receives the higher of Fund Value or Sum Assured
should something happen to you.

Switch benefit: Switch between funds anytime to adjust your portfolio, based on your
goals and risk profiles. You can switch funds 4 times a year, at no cost. For
subsequent switches, you will be required to pay a switch fee of Rs. 100

LIFE TIME SUPER at a glance

Minimum/Maximum Entry Age 0 years to 65 years

Maximum Age at Policy Maturity 75 years

Minimum/Maximum Policy Term 10 years to 75 years

51
Premium Payment Frequency Monthly, half-yearly, yearly

Minimum Premium Rs. 24,000 per annum

Annual Premium x Term/2. Subject to a minimum of

Minimum Sum Assured
Rs. 1,00,000

Premium paid for the policy and critical illness benefit

Tax Benefit (8) rider will be eligible for tax benefit under Sec. 80C and
80D respectively. Any amount paid to you will be eligible
for tax benefits under Sec. 10 (10D) as per I Tax laws.

Why life time super:

As an individual who desires a lot from life-a car, a beautiful home and of course, the
comfort and contentment of your family-you would undoubtedly want to plan your
finances such that you can take care of all your requirements.
Invest in ICICI Prudential's LifeTime Super policy-a regular-premium unit-linked
policy, which offers potentially higher returns that systematically enable you to meet
your long-term financial objectives. In addition, LifeTime Super also provides the
protective benefit of an insurance cover, which keeps your family secure, always.

Comparision of lifetime super of icici pru with other companies.

Life Maker- Level

Features Life Time Super Insurance Cover

Premium Pay Frequency Regular Premium Regular Premium

Higher of the Fund Value or Sum
Assured, reduced by the applicable Higher of Sum Assured or
Death Benefit partial withdrawals Fund Value

Maturity Benefit Fund Value Fund Value

Minimum Annual Premium Rs 24,000 pa Rs. 15,000 /-

52
Min Term 10 years 10
Max Term 75 years 58
6 Funds – Flexi Growth , Flexi 4 Funds : Secure Plan,
Balanced , Maxi miser, Balancer , Balanced Plan, Growth
Choice of Funds Protector, Preserver Plan, Conservative Fund
Top-ups Not Allowed currently Allowed
4 switches free in a policy year. Min 2 switches free in a policy
Switches amt. Rs.2000 year

Allowed after completion of 3 policy Allowed after completion of

Partial Withdrawals years. Min Amount is Rs.2000 3 policy years.
Special Conditions (if any) None Redirection of Premium
Surrender Values
(At end of year 1) Nil Nil
(At end of year 2) Nil Nil
(At end of year 3) 98% Nil
(At end of year 4) 99% Nil
(At end of year 5) 100% Nil
Personal Accident Benefit
Riders ADBR,CIBR,WOPR Rider, Dread Disease Rider
Settlement Period Options Available. Upto a period of 5 years Not Available
Automatic Transfer Plan Available Not Available
Boundary Conditions
Min Age at Entry 0 12
Max Age at Entry 65 60
Max Age at maturity 75 70 years
Term/2*AP , subject to a min of
Min/Max Sum Assured Rs.1,00,000 Min Rs. 100,000
Increase/Decrease in Annual
Premium Not Allowed Increase allowed
Increase/Decrease in Term Not Allowed Not Allowed
Increase/Decrease in Sum Increase allowed
Assured Decrease not allowed Not Allowed

Charges

Premium Allocation Charges Life Time Super Life Maker Plan

18000-49999 : 20%,
Year 1 50000 & above : 18% 0.75%

Year 2 7.5% 0.80%

Yr 3 onwards 4% 1%
Fund Management Charges
Flexi Growth / Maximiser - 2.25%,
Flexi Balanced / Balancer - 2.25%, Varies from 0.90 % to
Protector- 1.5% & Preserver - 0.75% 1.25 %

53
Policy Administration Charge No Charge Rs 50 per month
Rs. 100 for subsequent
Rs. 100 for subsequent switch over 4 switch over 2 switches
Switching Charge switches in a policy year in a policy year
Partial Withdrawal Charge No charge 0.25 % of the amount
A one-time charge
payable at the inception
Miscellaneous Charge None of the policy of Rs. 700

Reliance Market
Features Life Time Super Return Plan
Premium Pay Regular and Single
Frequency Regular Premium Premium
Higher of the Fund Value or Sum Assured, Higher of the Fund Value or
Death Benefit reduced by the applicable partial Sum Assured,\ which ever is
withdrawals the higher
Maturity Benefit Fund Value Fund Value
Minimum Annual Rs 10,000 for Regular & Rs.
Premium Rs 24,000 pa 25,000 for Single Prem.
Min term 10 5
Max Term 75 40
Investment Related:
4 Funds : Capital Secure,
6 Funds - Flexi Growth, Flexi Balanced, Balanced Fund, Growth
Choice of Funds Maxi miser, Balancer, Protector, Preserver Fund, Equity Fund
4 switches free in a policy year. Min Switch 1 switch free in a policy
Switches Amt :RS 2000 year
2 Partial wdrwl Allowed
Allowed after completion fo 3 policy years. after completion of 3 policy
Partial Withdrawals Min Amount is Rs.2000 years. Min Amt is Rs.10000
Special Conditions
(If Any) None Redirection of Premium
Surrender Values
(At end of year 3) 98% 100%
(At end of year 4) 99% 100%
(At end of year 5) 100% 100%
Accidental Death &
Accidental Total and
Permanent Disablement
Riders ADBR,CIBR,WOPR Benefit
Settlement Period Available Up to a period of 5 years Available Up to a period of

54
 Options 5 years
Automatic Transfer
Plan Available Not Available
Boundary condition
Min Age at Entry 0 0
Max Age at Entry 65 65
Max Age at maturity 75 80
Min : For Single Premium
-125% of SP, For Regular :
Term/2*AP , subject to a min of Rs.1,00,000
Annualized Premium for 5
Min Sum Assured years or for half the Policy term
Increase/Decrease in
Annual Premium Not Allowed Not Allowed
Increase/Decrease in
Term Not Allowed Not Allowed
Increase/Decrease in Increase allowed Increase allowed
Sum Assured Decrease not allowed Decrease not allowed

Charges
Life Time Super Reliance Market Return Plan
Premium Allocation
Charges
18000-49999 : 20%, For 5-9 term yr - 10%, 10-14
Year 1 50000 & above : 18% term yr- 15%, 15+ yrs - 20%
Year 2 7.5% 5% thereafter
For Single Premium its 2%
Yr 3 onwards 4% throughout
Flexi Growth / Maximiser - 2.25%, Capital Secure - 1.50 % ,
Flexi Balanced / Balancer - 2.25%, Balanced Fund- 1.50%, Growth
Fund Management Protector- 1.5% & Preserver - Fund - 1.75% , Equity Fund- 1.75
Charges 0.75% %
Policy Administration
Charge No Charge Rs 40 per month
Rs. 100 for subsequent switch over Rs. 100 for subsequent switch
Switching Charge 4 switches in a policy year over 4 switches in a policy year
Partial Withdrawal
Charge No charge Rs 100 per withdrawl
Miscellaneous Charge None None

55
 CHAPTER 6

FINDING AND DATA ANALYSIS

56
 Finding and data analysis

SAMPLE SIZE

RESPONDENT CATOGERY NO. OF PEPOLE

Service Man 28
Business Man 33
Shopkeeper 17
Housewife 8
Other 14
TOTAL 100

Q1. Do you have any insurance policy?

OPENION NO OF PEOPLE
YES 87
NO 13

57
 NO OF PEOPLE

13%

YES
NO

87%

Q2. Which company’s policy you are having?

COMPANIES PEOPLE
LIC 61
ICICI 8
HDFC 7
OTHER 11
NON POLICY 13
HOLDER

58
 PEOPLE

13%
LIC
11%
ICICI
HDFC
7% OTHER
61%
8% NON POLICY HOLDER

Q3.Why did you purchase insurance plan?

CATEGORIES NO. OF PEPOLE

FOR PROTECTION 15
FOR SAVING 21
FOR INVESTMENT 35
FOR TAX SAVING 29

59
 NO. OF PEPOLE

15%
29%
FOR PROTECTION
FOR SAVING
21% FOR INVESTMENT
FOR TAX SAVING
35%

Q4. Are you satisfied with your Investment?

CATEGORIES NO. OF PEOPLE

SATISFIED 56
UNSATISFIED 31
NO POLICY 13
HOLDER

60
 NO. OF PEOPLE

13%

SATISFIED
UNSATISFIED
31% 56% NO POLICY HOLDER

Q5. Have you ever invested in ULIP?

61
CATEGORIES NO. OF PEPOLE
YES 56
NO 31
NO POLICY HOLDER 13

NO, OF PEOPLE

13%

YES
NO
NO POLICY HOLDER
31% 56%

Q6. If yes, then in which plan?

CATEGORIES NO. OF PEPOLE

62
SAVING PLAN 40
PROTECTION PLAN 23
PENSION PLAN 7
CHILD’S PLAN 17
NO POLICY HOLDER 13

NO. OF PEOPLE

13%

40% SAVING PLAN

17%
PROTECTION PLAN
PENSION PLAN
CHILD'S PLAN
7% NO POLICY HOLDER

23%

Q7. How much return you are expecting from your ULIP?

CATEGORIOES NO OF PEPOLE
15-25% 20
25-35% 21
35-45% 19

63
MORE THAN 45% 27
NON POLICY HOLDER 13

NO OF PEPOLE

13% 20%
15-25%
25-35%
35-45%
27% MORE THAN 45%
21%
NON POLICY HOLDER
19%

Q8. Do you think ULIP is a risky investment?

64
 CATEGORIES NO.OF PEPOLE
VERY RISKY 13
MODERATE 18
SAFE 36
VERY SAFE 20
NON POLICY HOLDER 13

NO. OF PEOPLE

13% 13%
VERY RISKY
20% 18% MODERATE
SAFE
VERY SAFE
NO POLICY HOLDER
36%

Q9. Do you know about the life time super investment plan of
ULIP?

CATEGORIES NO.OF PEPOLE

65
YES 59
NO 41

NO.OF PEPOLE

41%
YES
NO
59%

Q10. Do you think life time super investment plan of ICICIPRU is better other plans?

CATEGORIES NO.OF PEPOLE

YES 33

66
 NO 26
DON’T KNOW 41

NO.OF PEPOLE

33%
41%
YES
NO
DON’T KNOW

26%

Q11. What are the reasons for investment in ULIP?

CATEGORIES NO.OF PEPOLE

67
LIFE PROTECTION 31
INVESTMENT & SAVING 29
FLEXIBILITY 11
TAX PLANNING 16
NO POLICY HOLDER 13

NO. OF PEOPLE

13%
31% LIFE PROTECTION
16% INVESTMENT & SAVING
FLEXIBILITY
TAX PLANNING
11% NO POLICY HOLDER
29%

Q12. What steps do you suggested to the companies to make their ULIP plans more
popular?

CATEGORIES NO. OF
PEPOLE

68
GIVE MORE ADVERTISEMENTS 36
ARRANGE MORE WORKSHOPS 13
ARRANGE MORE SEMINARS 14
REDUCE CHARGES 21
CREATE AWARENESS 16
THROUGH ADVISORS

NO. OF PEOPLE

GIVE MORE
ADVERTISEMENTS
16% ARRANGE MORE
36% WORKSHOPS
ARRANGE MORE
SEMINARS
21%
REDUCE CHARGES
14% 13%
CREATE AWARENESS
THROUGH ADVISORS

FINDINGS

• Now people mainly prefer ULIP for saving, then bank

and then Post-Office and after that prefer P.P.F. and other. The
main reason behind the insurance plan or ULIP preference is
switching facility or option to choose fund.

69
• Mainly people prefer low growth safe return as compare
to high growth some risky return.
• People mainly purchase life insurance policy for
investment and then for tax-saving they give 2nd preference to
protection.
• I also find that people mainly prefer L.I.C. as compare
to private insurance company.
• In my survey, I also find that only 56% people are
satisfied with current policy.
• It was also find out that only 59% people know about
life time super plan of ICICI Prudential.
• About 56% people finds ULIP is a safe mode of
investments.

70
 CHAPTER 7

RECOMMANDATIONS

RECOMMENDATIONS

1. Emphasis on advertisement: Company should emphasis on insurance plan

advertisement, because at present company main focus on conventional
product advertisement.

71
2. Increase in commission: Company should also change the commission
structure of F.C., because in initial year commission is very high as compare
to remaining year. So F.C. does not focus on remaining year and many
policies lapsed.
3. Making ICICI more accessible: Here I mean that as 80% of the population
of India is rural therefore ICICI must have there branches in important towns
so it not only this will increase the awareness among people more over it will
help the company to acquire local market and cater to their needs effectively.
4. There should be a product with similar features and low initial premium:
A product like Life Time super is suitable for all but the initial premium which
cannot be less than 20000 Rs. is on the higher side, therefore the company
should derive a product with similar features but with low initial premium so
that it is affordable to normal service class.
5. Administration charges should be low as in comparison with mutual
funds, national saving certificate (N.S.C) etc.: The Company should lessen
down the administration charges so that this product can have an edge over
other investment modules like N.S.C, P.P.F etc.
6. Market surveys should be conducted regularly so that to know about
customer demands and changing needs: The Company should know about
the customers changing needs and demands by conducting market surveys
which are helpful in innovating a product which suits the customer’s
requirements.
7. There should be Training batches on weekends: It is advised that the
company should have training batches for the already serving class on
weekends, so that the willing candidates can opt it as a part time business
opportunity.

72
 CHAPTER 8

SUMMARY/CONCLUSION

CONCLUSION

In India, insurance is generally considered as a tax-saving device instead of its other

implied long-term financial benefits. Indian people are prone to investing in properties

73
 and gold followed by banks deposits. They selectively invest in shares also but the
percentage is very small—4.5%. Even to this day, Life insurance market has become
more vibrant. Smashing all doubts over the decision to liberalize the industry, the
overwhelming first year performance of the Indian insurance sector is test case of a
massive success story of private players entering into the erstwhile state monopoly.

The top three insurance companies-ICICI Prudential Life Insurance Company, HDFC
Standard Life and Max New York Life- combined managed to sell over two lakh
policies in a single year. ICICI Prudential, touted as the number one private life
insurer, scored on all three fronts-with the maximum number of policies sold
(1,00,000 policies), highest amount of premium collected (Rs. 2,700 crore).

74
 CHAPTER 9

BIBLIOGRAPHY

BIBLIOGRAPHY

Printed Sources:

75
1. ICICI Prudential Life Insurance Company
Unit Linked Product Guide.

Brochures:

ICICI Prudential Life Insurance Company.

Life Insurance Corporation Ltd.

Birla Sunlife Life insurance Company

HDFC Standard Life Insurance Company

Om kotak Life Insurance Company

Bajaj Allianz Life Insurance Company

Publications:

www.bimaonline.com

www.google.com

www.licindia.com

www.iciciprulife.com

www.birlasunlife.com

76
 CHAPTER 10

ANNEXURE

QUESTIONNAIRE

Q1. Do you have any life insurance policy?

77
 Yes ( ) No ( )

Q2. Which company’s policy you are having?

LIC ( ) ICICI PRUDENTIAL ( )

HDFC STANDARD ( ) OTHER ( )
NO POLICY ( )

Q3. What is the reason for purchasing life insurance policy?

Protection ( ) Saving ( )
Life cover ( ) Tax saving ( )

Q4. Are you satisfied with your policy?

Yes ( ) No ( )

Q5. Have you ever invested in ULIP?

Yes ( ) No ( )

Q6. If yes, then in which plan?

Saving plan ( ) Protection plan ( )

Pension plan ( ) Child’s plan ( )

Q7. How much return do you expect from ULIP?

15 – 25 % ( )
25 – 35 % ( )
35 – 45 % ( )
More than 45% ( )

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Q8.Do you think ULIP is a risky investment?

Very risky ( )
Moderate ( )
Safe ( )
Very safe ( )

Q9. Do you know about Life time Super plan of ICICI prudential?

Yes ( ) No ( )

Q10. Do you think Life time super plan of ICICI pru is better than other plans?

Yes ( ) No ( )

Q11. What are the reasons for investment in ulip?

Life protection ( )
Investment and Savings ( )
Flexibility ( )
Tax planning ( )

Q12. What steps do you suggested to the companies to make their ULIP plans more
popular?
Give more advertisements. ( )
Arrange more work shops. ( )
Arrange more seminars ( )
Reduce charges ( )
Create awareness through advisors ( )
Others ………………………………………..

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Q13. Personal Details
NAME -------------------------
AGE ------------------------------------
QUALIFICATION ----------------------------------------------------
OCCUPATION ---------------------------------------------------------
ADDRESS ----------------------------------------------------------------------

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